Today, Sovereign Bank New England is the 3rd largest bank in New England, but less than two years ago the bank did not exist. This entry outlines the communications plan that took a non-existent bank and made it one of the most valued corporate citizens in the New England region. The plan began with relationship marketing designed to introduce SBNE to key opinion leaders throughout New England and ultimately led to Sovereign winning the largest branch divestiture in U.S. history. The plan continued with community and media outreach that positively introduced Sovereign to a region frustrated by bank mergers and conversions. The lynchpin of this plan was the strategy undertaken to secure Sovereign positive media coverage on conversion day in Boston, a day typically fraught with negative headlines. This strategy included the first public-private partnership with the Massachusetts Bay Transportation Authority in its 100-year history. The impact of this campaign is clear: Sovereign retained more than 99.8 percent of its customers – better than the national average of 90-95 percent and unprecedented in a market hostile to bank mergers.
The 1998 Fleet Bank and BankBoston merger prompted the U.S. Justice Department to mandate the divestiture of 281 bank branches in Massachusetts, New Hampshire, Rhode Island and Connecticut. National financial institutions including Bank of America, Chase Manhattan and BankOne, were considered early bidders for the divested branches. However, Philadelphia-based Sovereign Bancorp. saw an opportunity to build upon its mid-Atlantic success and position itself as a formidable competitor in the middle market. It would also place headquarters in Boston and commit to growing the New England workforce. A communications plan was needed to marketed this vision to key influencers. Once the branches were won, the bank would need another plan to introduce the new company to a community frustrated by bank conversions.
GPC and Sovereign’s top executives held numerous strategy sessions to devise the communications plan. GPC also undertook an in-depth market analysis detailing government and customer attitudes toward banking conversions.
- Share Sovereign’s strategic message with key government decision makers
- Win the largest branch divestiture in U.S. history
- Introduce SBNE to elected officials, customers and businesses in Massachusetts, New Hampshire, Connecticut and Rhode Island.
- Overcome negative publicity surrounding banking conversions
- Retain customers reassigned to Sovereign through branch divestiture
GPC drafted a communications and government relations plan divided into two segments. The first segment outlined strategies and tactics for the Divestiture Campaign. The ultimate goal of this campaign was to be named by the Department of Justice as the recipient of the 281 divested branches. This campaign focused solely on relationship marketing since law prohibited Sovereign Bancorp from discussing its proposal with the media or outside entities.
The second stage, the Introduction Campaign, began the moment Sovereign was announced as the winner. This campaign sought to quickly boost the new company’s identity in the region and position SBNE as a solid corporate citizen. Given the negative coverage of other conversions, GPC developed a strategy that “set the expectations bar” and explained to customers what to expect during the conversion. Sovereign’s honesty in communicating the problems that accompany conversions demonstrated its dedication to solving problems and was a boon to the bank’s credibility. A major community event on the day of the largest conversion in the largest media market aimed to assuage negative media and gain positive coverage.
GPC executed the communications strategy with a variety of public events, corporate initiatives, announcements and meetings with key opinion-leaders, including:
- Holding a press conference announcing the selection of Sovereign Bank;
- Creating and announcing the “Solutions Center.” SBNE had promised to be forthright and proactive about problems that occur with conversions. The creation of the Solutions Center reinforced this message. The motto was “a solution for every call, every time;”
- Announcing SBNE’s three-year community reinvestment plan;
- Arranging media tours across the region for top bank executives to meet with editorial boards of major newspapers, business reporters, and television and radio reporters;
- Working with an advertising agency to coordinate messaging and events; and
- Developing a weekly press release campaign targeted to local media, with customer tips to help them through the conversion.
Implementation of the government relations plan hinged on the invaluable relationships SBNE fostered with New England elected officials during the divestiture selection process and the conversions. During this time, there was lingering concern about SBNE’s ability to “do the deal,” and skepticism about the bank’s ability to raise the necessary financial backing. In both cases, elected officials were asked to comment by the media. The resulting comments were supportive due to SBNE and GPC’s proactive briefings. For example, Attorney General Tom Reilly was the first elected official quoted about SBNE being selected as the successful bidder. As a result of proactive outreach he expressed his support for SBNE as a strong candidate.
In addition, by shaping SBNE’s future role in New England and actively introducing SBNE to key elected officials, GPC was able to:
- Neutralize potential SBNE opposition through consistent and thorough outreach;
- Build the foundation for positive relationships with key community activist groups;
- Arrange meetings across the region between top bank executives and elected officials;
- Establish positive relationships with key government officials.
Signature Event: First Private-Public Partnership with Massachusetts Bay Transportation Authority
At the time of the Sovereign conversion, the New England region had experienced several banking conversions in recent years. Citizens were frustrated by the constant change these mergers inflicted on their lives. Previous mergers and conversions in the region had been executed poorly and were covered in the media. Typical day-of-conversion news focused on the negatives, including customer complaints and banking errors. Reporters were prepared to investigate and expose Sovereign’s shortcomings; however, GPC anticipated this and developed a campaign to change the coverage on conversion day from negative to positive.
What better way to introduce yourself to a new market than by giving your potential customers something for free? SBNE gave Boston’s 330,000 commuters a free ride on the Massachusetts Bay Transportation Authority subways during rush hour on the first day SBNE opened for business in the Greater Boston area. Rides were free again that afternoon for fans going to the Red Sox vs. Yankees game. This was the first public-private partnership between a corporate citizen and the nation’s oldest transit system.
On the Thursday before “Conversion Monday,” SBNE held a news conference at a major subway station to announce its plan. Bank employees and support staff handed out information flyers on Monday at subway stops and Sovereign’s CEO and COO and the MBTA general manager greeted commuters at the main subway station.
Sovereign Bank retained 99.8 percent of divested customers, better than the national average of 90-95 percent and unprecedented in a market hostile to bank mergers.
Sovereign’s CEO was named a top 25 newsmaker in 2000 by the Boston Business Journal.
News coverage of the announcement began on June 15 and continued throughout the weekend.
On “Conversion Monday” the SBNE news coverage led in every Boston newspaper, every Boston-area radio station, every few minutes during the morning radio traffic reports and on all Boston-area television stations.
Boston’s WBZ-TV did the morning “live shot” from the Park Street station, including six live reports during the morning newscast between 5 a.m. and 7 a.m., including interviews with the bank CEO and COO.
Other Boston television stations also covered the MBTA event. The positive news continued into the evening.
Positive stories on Sovereign’s entry into the Boston market were seen and heard by more than 1 million people.